Gov’t Creates National Logistics Ecosystem to Reduce Cost to 17%
Date 25 September 2020
According to Minister of Finance Sri Mulyani, the establishment of National Logistics Ecosystem (NLE) aims to reduce logistics costs from 23.5% to 17% of the Gross Domestic Product (GDP).
The entire upstream to downstream process mainly contributes to the 5-6% reduction. In addition, the transportation sectors will connect to each other and the process will be simpler so it will be more convenient for business players to do business.
The President, according to her, has improved the NLE to increase competitiveness of the Indonesian economy. Coordinating Minister for Economic Affairs, Coordinating Minister for Maritime Affairs and Investment, as well as Cabinet Secretary and all relevant Ministries/Agencies will participate in the program to improve the system.
“Our logistics costs compared to our neighboring countries, especially in ASEAN and the closest neighbors such as Singapore and Malaysia, are still higher; thus Indonesia needs to improve its competitiveness,” said the Minister.
With this reform, Sri expressed hope that the logistics sector will be improved, not only in terms of efficiency but also in terms of its contribution in increasing the competitiveness of the entire national economy and in terms of creating healthy competition with the existence of service standards and transparency.
The NLE, according to the Minister, is expected to create convenience and clarity in the entire process since all documents and processes can be shared.
All related aspects, such as truck system, depot, container, shipping and payment system, can be included in the national logistics ecosystem so that it will only need single submission for the whole process.
She went on to say that the whole business process will integrate into a single submission system which will definitely make it easier for business players.
In conclusion, the NLE is a platform where business players can share the whole business process without having to repeatedly submit the documents needed. The payment system will be included in the payment platform by involving the central bank (Bank Indonesia) and several state-owned banks.
“We created the NLE with a very broad contribution and collaboration with numerous institutions. More than eighteen Ministries/Institutions, banking system, as well as the institutions related to transportation, warehousing, incoming depots, will join the NLE,” she added.
As of September or October, Sri said that she had implemented a single inspection submission and profile between customs, fish quarantine and agricultural quarantine.
The Government, according to the Minister, is also carrying out licensing integration for the entry of consumer goods in special areas, especially in Batam Island.
“The delivery order redemption, the approval of the release of containers, the orders for trucks will be made online to increase efficiency. Online payments will also be integrated with various platforms, especially at the ports in Tanjung Priok and Batam,” she explained. (MAY/EN)
Translated by: Estu Widyamurti
Reviewed by: Mia Medyana